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Abstract
With efforts to de-layer organizations and reduce functional boundaries, coordination and
work of importance increasingly occur through networks of informal relations rather than
channels tightly prescribed by formal reporting structures or detailed work processes.
However, while organizations are moving to network forms through joint ventures,
alliances and other collaborative relationships executives generally pay little attention to
assessing and supporting informal networks within their own organizations. Working
with a consortium of 23 companies over the past eighteen months we have found social
network analysis a valuable means of facilitating collaboration in strategically important
groups such as top leadership networks, strategic business units, new product
development teams, communities of practice, joint ventures and mergers. This article
outlines how social network analysis can be effective in: 1) Promoting collaboration
within a strategically important group; 2) Supporting critical junctures in networks that
cross functional, hierarchical or geographic boundaries and 3) Ensuring integration of a
network following restructuring or other strategic change initiatives. By making informal
networks visible, social network analysis helps managers systematically assess and
support strategically important collaboration.
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For example, research has shown that relationships are critical for obtaining information (e.g., Simmel,
1923; Granovetter, 1973; Allen, 1977; Burt, 1992; Rogers, 1995; Szulanski, 1996) learning how to do your
work (e.g., Lave & Wenger, 1991; Brown & Duguid, 1991 & 2000; Orr, 1996; Wenger, 1998; Wenger &
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Snyder, 2000) and collectively solving cognitively complex tasks (e.g., Weick & Roberts, 1993; Hutchins,
1991; Moreland, Argote, Krishnan, 1996; Hollingshead, 1998).
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It is one problem to learn or act on knowledge with others who think like you (such as in a community of
practice). It is an entirely different problem to do this in diverse social contexts, such as cross-functional
teams, where people often do not share a common vision, language, metrics of performance or even
understanding of the problem itself. For example, sociologists have poignantly demonstrated how correct
information can have little or no impact on critical decision processes (Janis, 1982; Perrow, 1986; Vaughn,
1996). Further, organizational theorists have shown that a persons knowledge can be role constrained
(March & Olsen, 1975; Pentland, 1992) or not acted upon due to motivational or cognitive impediments
resulting from introducing knowledge into diverse social contexts (Dougherty, 1992; Fiol, 1994; Boland &
Ramkirshnan, 1995; Szulanski, 1996).
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To be sure, academics and practitioners have discussed shifts to network forms via mechanisms such as
joint ventures, partnerships, strategic alliances and R&D consortia for some time now (Miles & Snow,
1986, 1994 & 1995; Handy, 1994; Heckscher, 1994; Galbraith, 1995). Such forms are presumed to allow
for the effective integration of knowledge and capabilities across organizational entities. However, there
has been much less practical attention paid to how informal networks of employees in either traditional or
networked organizations facilitate or impede organizational effectiveness.
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Over the past eighteen months we have conducted research to determine how
organizations can better support work occurring in informal networks of employees.
Working with a consortium of Fortune 500 companies and government agencies we
assessed collaboration and work in 29 informal networks from 23 different organizations.
In all cases, the networks we studied provided strategic and operational value to the
embedding organization by enabling employees to effectively collaborate and integrate
disparate expertise. We targeted such networks as a first goal of our research was to better
define scenarios where conducting a social network analysis would likely yield sufficient
benefit to justify the investment of time and energy on the part of the organization. We
also worked closely with each organization when providing feedback as a second goal of
our work was to develop generalized insight into analyses that were informative and
actionable for practitioners as well as interventions resulting from a social network
perspective. While we enrich our points below with four case examples, they should be
seen as exemplars drawn from the 29 networks we worked with in this research. We now
turn to examples and practical guidelines regarding the use of social network analysis to
improve collaboration and work in strategically important, informal networks.
Put an organizational chart (the formal structure) in front of most any employee
and they will tell you the boxes and lines only partially reflect the way work gets done in
their organization. Informal relationships among employees are often far more reflective
of the way work happens in an organization than relationships established by position
within the formal structure. However, these informal relationships are often invisible or
at least only partially understood by managers --- a problem that is growing with de4
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layering of organizations, virtual work and globalization. While managers often think
they understand the networks around them, studies show that they can vary widely in the
accuracy of their network perceptions (e.g., Krackhardt, 1987 & 1990; Casciaro, 1998).
As outlined in Krackhardt & Hansen (1993: p. 104), Although managers may be able to
diagram accurately the social links of the five or six people closest to them, their
assumptions about employees outside their immediate circle are usually off the mark.
Social network analysis (SNA) can be an invaluable tool for systematically
assessing and then intervening at critical points within an informal network. Of course
social network techniques have been around for some time. The idea of drawing a
picture (called a sociogram) of who is connected to whom for a specific set of people is
credited to Dr. J.L. Moreno (1934), an early social psychologist who envisioned mapping
the entire population of New York City. Cultural anthropologists independently invented
the notion of social networks to provide a new way to think about social structure and the
concepts of role and position (Nadel, 1957; Mitchell 1969), an approach that culminated
in rigorous algebraic treatments of kinship systems (White, 1963; Boyd, 1969). At the
same time, in mathematics, the nascent field of graph theory (Harary, 1969) began to
grow rapidly, providing the underpinnings for the analytical techniques of modern social
network analysis. The new methods were particularly embraced in sociology, where
relational theoretical perspectives had been important since the dawn of the field
(Durkheim, 1893; Simmel, 1922).
Today, the scholarly discipline is growing in the field of management as
researchers have clearly demonstrated the extent to which informal networks pervade and
effect life and work within organizations (e.g., Lincoln, 1982; Wellman & Berkowitz,
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1988; Nohria & Eccles, 1992; Andrews & Knoke, 1999). A particularly important line of
inquiry in this work has been to understand forces influencing the emergence of informal
networks within organizations (Monge & Eisenberg, 1987; Monge & Contractor, 2000).
Through such work we have learned that communication is likely to occur in
homophilous4 relationships and have evidence of the role of similarity between people in
increasing the likelihood of communication (e.g., Zenger & Lawrence, 1989; Ibarra, 1992
& 1995; McPherson, et al 2001). At the same time we have also learned that design of an
organization can have a strong influence on the pattern of informal networks via formal
structure (e.g., Lincoln, 1982; Stevenson, 1990; Stevenson & Gilly, 1993; Brass, 1994),
physical proximity (e.g., Allen, 1977; Monge, Rothman, et al, 1985) and nature of the
task (Bavelas, 1950; Leavitt, 1951; Shaw, 1964).
This and other research has begun to help us think about means of assessing and
supporting informal networks within organizations. Yet while clearly informing the field
of management, the majority of this work is found in academic outlets often inaccessible
to practitioners due to the technical nature of the publications and network terminology
employed. In addition, these pieces intend to advance science and so do not as a matter
of practice make clear to managers the ways in which network analysis can be applied to
organizational issues. While the outcomes of such research might influence decisionmakers in terms of policy variables a more contextualized perspective is needed to help
practitioners apply network analysis to their specific organizational concerns.
At the most rudimentary level, we have found that visually assessing the pattern
of relationships that hold a certain group together can reveal a number of interesting and
Homophily refers to the extent to which communicating individuals are similar (Lazersfeld & Merton,
1964).
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actionable points. For example, identifying people that are highly central in networks
(and so disproportionately impact a group by controlling information or decision-making)
can help a manager consider how to reallocate informational domains or decision-making
rights so that the group as a whole is more effective. Alternatively, understanding who is
peripheral in a network and crafting ways to engage these people is also an important
means of ensuring that expertise resident in a given network is being effectively utilized.
Particularly in todays age of turnover it is increasingly important to get people connected
more and more quickly so that they are productive for an organization. And of course
assessing junctures in networks that are fragmented across functional or hierarchical
boundaries (or detecting sub-groups) can be particularly informative for social or
technical interventions that help to integrate disparate groups.5
While social network information can be obtained in a variety of ways, the most
pragmatic means in organizational settings is typically through surveys. Very
informative social network diagrams can be generated from 10-15 minute surveys
assessing information or knowledge flow amongst members of a group. In this process,
the first step is to identify an informal network where effective collaboration and
knowledge sharing has a significant impact on the organizations operations or strategy.
Often these groups do not appear on a formal organizational chart yet their ability to
collaborate and pool disparate expertise is critical to the current and future success of an
organization. As a result in the first stages of a social network analysis it is often
important to push executives beyond groups defined by the formal organizational chart to
those that might cross functional or hierarchical boundaries (e.g., new product
5
Social network researchers have also developed a wide range of quantitative analyses and tools for
assessing networks. While beyond the scope of this paper, readers interested in more depth on this front
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to account for the fragmentation of this network. The group on the left side of the
network was skilled in the softer issues of strategy or organizational design, often
focusing on cultural interventions or other aspects of organizations to help improve
knowledge creation and sharing. The group on the right was composed of people skilled
in harder technical aspects of knowledge management such as information architecture,
modeling and data warehousing.
Over time, members of these two sub-groups had gravitated to each other based
on common interests. These people often worked on projects together and just as
importantly shared common work-related interests in terms of what they read, conference
attendance and working groups within the organization. The problem was that each subgroup had grown to a point of not knowing what people in the other sub-group could do
in a consulting engagement or how to think about involving them in their projects. Thus,
even when there were opportunities in client engagements to incorporate each others
skill sets, this was often not done because neither group knew what the other knew or
how to apply their skill sets to new opportunities. This was despite the fact that the
groups strategic charter was to integrate these unique skill sets and that all aspects of
formal organizational design supported this mission (e.g., reporting structure, common
performance metrics and incentives, etc.).
Conducting the social network analysis provided several intervention
opportunities. A lengthy facilitated session with this group allowed them to assess and
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discuss the relative isolation of the two specialties as well as more pointed concerns about
certain members expertise not being tapped while other members appeared to be
bottlenecks in sharing information. As a result of the discussion around this social
network various changes were made to the groups operations. First, a variety of internal
projects ranging from whitepapers to development of a project tracking database were
jointly staffed with one person from each group. This forced people to work together and
so begin to develop an appreciation of each others unique skills and knowledge. Second,
the partner implemented mixed revenue sales goals so that each of the managers were
accountable for selling projects that included both a technical and organizational
component. This also forced people to find ways to integrate their approaches to
addressing client problems. Finally, several new communication forums were created --including weekly status calls, a short update e-mail done weekly and a project tracking
database that helped each person keep up to date on what other members were doing.
The result of these interventions was significant. Over the course of the next
several months, the group began to sell more work that integrated technical and
organizational skills. And this integration often proved to differentiate the consultancy
from their competition in the sales process. Further, as can be seen in the bottom half of
Exhibit 1, a network analysis conducted nine months later revealed a well-integrated
group that was sharing information much more effectively.
In this case the underlying problem was that each subgroup had grown to a point
of not knowing what the other group knew (and so how to even consider integrating their
expertise in projects). As a result, the interventions undertaken focused on helping to
develop this awareness and not simply implementing a collaborative technology or group
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process intervention that ultimately would not have addressed the underlying need to
create an awareness of each others expertise. Other common factors fragmenting
networks include: 1) hierarchical leadership style; 2) physical dispersion and virtual
work; 3) politics resulting in sub-groups; 4) a not invented here mentality resulting in
networks with dense sub-groups only weakly connected to other sub-groups; and 5)
workflow processes or job descriptions that overload specific roles and slow the group.
Each of these issues demands a different set of interventions; however, social network
analysis, combined with some interviews, makes these interactions visible allowing for a
diagnosis and an appropriate solution.
critical collaboration within and between functional units, divisions and even entire
organizations. Network analysis provides us with the means to understand where
collaboration is and is not occurring.
divisions. For example, a quick review of Exhibit 2 shows that divisions 3 & 4 had a
relatively high degree of collaboration; whereas divisions 1 & 7 had minimal contact.6
A side benefit of our research program has been development of an extensive database that can be used
for benchmarking purposes.
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collaborative activity among all departments within an organization. People have a finite
amount of time to put into developing and maintaining relationships. With network
analysis, we can begin to take a portfolio approach to considering the constellation of
relationships that is worth investing time and energy to develop and maintain. For
example, in the disguised scenario outlined above, it was not critical that Division 1 be
tightly connected to all other divisions to help the organization meet strategic objectives.
To provide strategic value to the organization, Division 1 really only needed to be well
connected to Divisions 3, 5 and 6. Thus, rather than engage in a company-wide initiative
to improve collaboration, more targeted and ultimately more successful interventions
were employed to facilitate collaboration at specific junctures.
Mapping the pattern of information flow (or, more frequently, lack of flow) across
functional barriers can yield critical insight into where management should target efforts
to promote collaboration that will provide strategic benefit. Quite often initiatives
attempting to promote collaboration and learning take a cultural perspective and usually
struggle with the enormity of the task at hand. In contrast, we have found that by
targeting junctures in networks that hold strategic relevance for an organization it is much
more feasible to intervene where investments in collaboration yield strategic payoff for
the organization. And by tracking changes in networks over time, management and
network participants have a very real way of assessing the impact of interventions on
both the informal network and organizational effectiveness.
various companies in our research we have seen very different network patterns in
relation to hierarchy. Some organizations informal networks are very similar to, and
thus obviously constrained by, the organizations hierarchy. Others are more fluid and
seem to place less of a constraint on whether employees follow the chain of command to
obtain information. What is good or bad depends on the kind of work the organization
does; however, it is interesting diagnostically to see the extent to which hierarchy
conditions information flow and knowledge exchange in a given organization. Just as we
analyzed collaboration across divisional boundaries in the conglomerate above, we can
also assess collaboration and information sharing across hierarchical levels within an
organization.
Alternatively, we can assess how those in positions of formal authority are
embedded in larger networks within their organization. For example, we were asked to
map the top leadership network of a commercial bank. However, rather than just
mapping the top nine members of the management team, we looked at information
seeking and sharing behaviors among the top 62 executives of this organization (SVP
level and above) to understand how this network was collaborating. One particularly
informative view came from assessing the pattern of relationships among the top nine
executives and then between these executives and the overall top 62 executives in the
institution. By pulling out the top nine executives and mapping the flow of information
amongst these executives we could assess the extent to which this group was effectively
collaborating as a decision-making body. Further, by considering this group in the
context of the larger network of 62 people we could also see the extent to which the
executive team tapped into the larger leadership network for informational purposes or
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Diagnostically, these kinds of views are important along two fronts. First, by
looking at a completed diagram showing the same relationship patterns for all members
of the top management team we can get a sense of how information tends to enter and
leave this group. The bulk of information that managers use to make decisions comes
from meetings and conversations. SNA provides a way to better understand the way in
which teams might be biased in critical decisions by virtue of the kinds of information
received in discussions with others. Which members of the executive team seem to reach
out to various functional areas (and so likely best understand issues and concerns of these
groups)? Is the executive group seeking information from (or at least listening to) these
people? Are certain functional departments more sought out than others (thereby
potentially representing biases in information this group relies on for strategic decisionmaking)? Given the strategic importance of the decisions that a top management team
makes, understanding their sources and usage of information can provide critical insight
into ways to improve their effectiveness. This of course also holds for other groups such
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as new product development initiatives or process redesign efforts where one hopes that
the teams are effectively reaching out to relevant and balanced sources of information
prior to making critical decisions.
In terms of executive development, these kinds of views can also be highly
effective in uncovering potential biases in a single persons network. A long-standing
finding in communication research is that people tend to interact with people that are
similar to themselves on a set of socially important attributes, such as race, gender and
age (e.g., Marsden, 1988; Carley, 1991; Ibarra, 1992 & 1995; Brass, 1995). This makes
communication easier and often more satisfying; however, it is also a source of bias in
what executives learn and think is important. In the example above it was apparent that
the CEO heavily attended to and was influenced by the concerns of the commercial
lending group where he spent the bulk of his career. In private conversations after
reviewing this diagram, he reflected on what he felt were ineffective tendencies in his
own decisions over time due in large part to the biased way he sought information from
others. As a result of the social network analysis of his organization he made more
concerted efforts to balance whom he sought out for information within and outside of
the bank.
terms of corrective action. The practice was globally distributed and of such size that he
had never even had the opportunity to meet many of the people. To get a better
understanding of this network he invited us in to conduct a social network analysis.
Our SNA confirmed the fragmentation of the network and provided some useful
insights and information to work with in helping integrate his practice. What we
immediately noticed was significant clustering in the network despite the entire practice
reporting to one overall partner and being embedded within a common organizational
context (i.e. strategy, performance metrics, technical infrastructure, etc.). As can be seen
in Exhibit 4, we found three tightly knit sub-groups rather than one integrated network --two in North America and one in Europe. And in fact, apart from the partner, only a
handful of hierarchically lower level employees served to bridge these sub-groups
because they had developed relationships when staffed on projects together.
A first intervention for this partner was to use the network diagram to create
common awareness of the lack of integration amongst the leaders of this practice. One of
the more important benefits of social network analysis is that it helps to make visible and
therefore actionable ways that work is occurring within organizations. We have worked
with global groups ranging up to almost 300 people with only 3 or 4 levels of hierarchy.
Clearly the span of control combined with the physical dispersion of such groups makes
it close to impossible for any one person or group of people to know what is going on or
how executive decisions are impacting work and effectiveness of these networks. Social
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network analysis provides a snapshot for executives that can be used to gain agreement
on what problems need to be addressed in such a distributed group, appropriate
interventions to take and an ability to conduct a follow on network analysis to ensure that
initiatives are having the desired impact.
In this case though formal aspects of the organization were aligned, we learned
that there were no initiatives in place to help employees learn others expertise and so
when and how to tap into them. As a result, the organization took a number of steps to
help build this awareness of who knows what. First, they redesigned their approach to
staffing both client projects and internal initiatives to help integrate people from the
different locations. On a technical front they implemented a skill profiling system and a
virtual environment to promote collaboration on consulting engagements. On a social
front, a series of face to face meetings were conducted to help people meet and learn the
projects that other people were working on and the expertise that they held. This was
critical to the groups integration as it was not until people actually met face to face that
the skill profiling system began to be used. Finally, a shift in skills targeted in recruiting
as well as performance measurement was made to encourage joint problem solving and
de-emphasize individual expertise and task accomplishment.
The two groups in the US represented another challenge for management. It
turned out that the majority of people in these two groups not only had offices in the
same building but also were interspersed along the same corridor. What we discovered in
interviews was a political problem that had emerged and resulted in tensions between two
sub-groups. While the partner leading the practice knew there were problems, the visual
representation of the network diagram clearly showed the extent to which these issues
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were impeding the overall group. Various steps were taken to help resolve the problem
including: executive coaching, revised performance management practices and an
extensive off site planning session with organizational development interventions to help
the group integrate.
In addition to altering various aspects of organizational design, other more
pointed interventions unfolded with various people in the network depending on whether
they were highly central or highly peripheral. For example, central people were
interviewed to see if certain aspects of their job could be parceled out to others so that
they were not over-burdened and in danger of becoming a bottleneck. Alternatively,
various approaches were taken with peripheral people to help get them integrated more
effectively (depending on the specific issue that seemed to result in their being
peripheral). A driving concern was helping to develop relationships throughout the
overall practice to improve knowledge sharing and the location of relevant expertise for
both sales efforts and client engagements. Increasing connection within the network also
reduced the extent to which the practice was exposed by the potential of central people
leaving. In this and many other examples we consistently find that a network view makes
it clear that should certain central people in a network leave they take more than just what
they know --- they also fundamentally affect the connectivity of the entire group.
have found it highly important to find ways to move people into the central part of the
network more quickly. Unfortunately, it is rare to find practices where a new person has
systematic opportunities to know what other people know in the organization and almost
unheard of to find practices that teach the group what new individuals know. This is a
critical shortcoming because as work becomes increasingly project-based, people are
being drawn into the center of these networks primarily as a result of what central people
understand about their knowledge and skills when new opportunities arise.
We have also found social network diagrams to be a powerful tool for individuals
to actively shape their personal networks. While certain managerial decisions and actions
can be important to facilitate development of a network, an equally critical means of
effecting change is for each person in the network to actively work on improving their
own connectivity. Where possible, a key component of our debrief sessions focuses on
getting people to use the network diagrams to assess the effectiveness of their personal
network along two dimensions. First, in terms of composition, we focus on the diversity
within each persons network (e.g., Do you rely too heavily on people from a specific
functional area, hierarchical level or just those that are close to you?). Second, in terms
of content, we focus on the resources that people derive from these relationships (e.g.,
career advice, information or other resources?). Focusing on these two questions
generally helps people recognize a need to invest in the development of specific kinds of
relationships (and often times reduce an investment being made in other relationships).
Of course, social network analysis is not a cure all. In our experience, it is
important to be cautious about over-correcting with groups. One organization we worked
with believed that a group of research scientists would function more efficiently if there
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were greater interaction across geographical regions. As a result, they put in place
several interventions to ensure that members of the department worked more closely with
people in other locations within the organization. After we performed the network
analysis we noticed that as a whole the department had integrated very well across the
various geographical locations but functional units within the department were not well
connected with each other despite sometimes being in the same building. This overcorrection had resulted in a series of effectiveness and efficiency problems for this group.
Thus as managers consider interventions it is important to take a balanced approach and
always realize that improving some connections likely takes time away from the
development and maintenance of others. People have only so much relational energy to
expend.
Conclusion
In todays fast-paced knowledge intensive economy, work of importance is
increasingly accomplished collaboratively through informal networks. As a result,
assessing and supporting strategically important informal networks in organizations can
yield substantial performance benefits. In addition, network relationships are critical
anchoring points for employees, whose loyalty and commitment may be more to sets of
individuals in their network than to a given organization. Our research (and that of
others) has found that these informal networks are increasingly important contributors to
employee job satisfaction and performance. Yet despite their importance, these networks
are rarely well-supported or even understood by the organizations in which they are
embedded. Social network analysis provides a means with which to identify and assess
the health of strategically important networks within an organization. By making visible
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Exhibit 1
Information Sharing within an Expert Consulting Group7
Pre-Intervention
Exhibit 2
Collaboration Across Merged Divisions within a Conglomerate
Division 1
Division 2
Division 3
Division 4
Division 5
Division 6
Division 7
Division 8
Division
1
Division
2
Division
3
Division
4
33%
5%
11%
2%
6%
7%
1%
10%
76%
18%
11%
7%
2%
3%
2%
45%
21%
12%
13%
16%
9%
38%
6%
7%
6%
6%
75%
2%
8%
3%
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76%
2%
10%
36%
0%
90%
Exhibit 3
Collaboration Across Hierarchical Boundaries
CEO
2
Relationships
7
Relationships
Commercial
Lending
1
Relationship
1
Relationship
Real Estate
Credit
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Operations
Exhibit 4
Information Sharing in a Global Consulting Practice
USA 1
Partner
Europe
USA 2
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Appendix 1
Collecting Network Data: What Questions to Ask
If Trying to Discover
Rationale To understand the informal structure. It can be particularly helpful to identify sub-groups or
cliques that might represent political problems or individual roles in these networks such as highly central
parties, isolates and bottlenecks.
Information network -- Who goes to whom for advice on work-related matters.
Rationale Just assessing who communicates with whom does not guarantee that the interactions reflect
exchanges of information important to do ones work. Particularly in efforts that require a collective to
effectively pool its knowledge (e.g., new product development), it is important to understand the
effectiveness with which a group traffics in information.
Problem-Solving network Who goes to whom to engage in dialogue that helps people solve problems at
work.
Rationale Interactions with other people help us think about important dimensions of problems we are
trying to solve or consequences of actions we are considering. Strong problem solving networks often ensure
that people are solving the right problem thus improving both individual and network performance.
Know network Who is aware of whose knowledge and skills.
Rationale Awareness of what someone else knows dictates whether and for what problems you are likely to
turn to them for help. Strong know networks are an essential basis for strong information networks.
Access network Who has access to whose knowledge and expertise.
Rationale Just knowing someone has relevant information or knowledge does not guarantee that they will
share it with you in a way that is helpful. A strong access network is often critical to ensuring effective
information sharing and problem solving in a sufficiently timely fashion.
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